Two Earthquakes, Two Responses
Recently, New Jersey experienced a mild 3.0 earthquake. No one was hurt, and no damage was reported. Mother Nature reminded us that some forces are beyond our control—geological shifts that we must simply endure and recover from.
But there has been another earthquake in Neptune, New Jersey—one that has rocked the economic bedrock of the township with far more devastating consequences. Unlike natural seismic events, this fiscal earthquake is entirely man-made and completely preventable. We cannot control natural earthquakes, but the state can definitely control the fiscal earthquakes that repeatedly devastate New Jersey communities.
The political machine within the state chooses to ignore the truth, the facts, and the reality that residents cannot and should not be forced to pay for the cowardice of representatives who are relentlessly taxing the middle class out of the state. While working families in Neptune face crushing $11,299 annual property tax bills, tony shore towns such as Allenhurst and Spring Lake pay an average of just $5,600 per year—exactly half of what Neptune residents are forced to bear.
This stark disparity exposes the fundamental inequity and dysfunction of New Jersey’s tax system, where middle-class communities are systematically overburden while wealthy enclaves enjoy relative relief.
Executive Summary
Neptune Township’s historic $1,477 average property tax increase represents more than a local budget crisis—it signals a dangerous trend that threatens the economic stability of Monmouth County and New Jersey as a whole. This unprecedented 25% school tax levy increase, driven by systematic cuts in state aid from $32 million to $8 million since 2018, exemplifies a broken funding formula that is undermining property values, driving out residents, and compromising the state’s long-term economic health.
Local Economic Impact: Neptune Township
The immediate consequences for Neptune’s residential real estate market are severe. With the average home assessed at $614,062 now carrying an $11,299 annual tax burden—nearly 1.8% of assessed value—the township faces:
Property Value Erosion: High tax burdens relative to property values create negative equity pressure, as potential buyers factor crushing tax obligations into their purchase decisions. Properties become less attractive investments when carrying costs exceed reasonable thresholds.
Resident Flight: Middle-class families, already stretched by inflation, face an untenable choice between financial stability and remaining in their community. The $1,477 increase represents a significant portion of disposable income for many households, forcing difficult decisions about relocation to more tax-friendly jurisdictions.
Business Climate Deterioration: Commercial property owners face proportional increases, making Neptune less competitive for business retention and attraction. Higher operating costs translate to reduced expansion, hiring freezes, and potential relocations.
Regional Ramifications: Monmouth County
Neptune’s crisis mirrors broader challenges across Monmouth County, where multiple districts are grappling with similar state aid cuts. The ripple effects include:
Housing Market Instability: As Neptune and neighboring communities become less affordable, the entire county’s residential market faces downward pressure. Buyers increasingly look to Pennsylvania, Delaware, and other states with more reasonable tax structures.
Commercial Real Estate Challenges: Businesses serving residential communities face reduced consumer spending as more household income goes to property taxes rather than local commerce. This creates a vicious cycle of reduced economic activity and further pressure on municipal revenues.
Infrastructure Strain: As residents and businesses leave, remaining taxpayers bear increasingly heavy burdens for maintaining roads, utilities, and services designed for larger populations.
Statewide Economic Threat
New Jersey’s school funding formula, S-2, has created a zero-sum game that pits districts against each other while systematically undermining the state’s economic foundation:
Talent Exodus: High-earning professionals and young families—the backbone of New Jersey’s tax base—are increasingly relocating to states with more reasonable tax burdens. This brain drain weakens the state’s competitive position in attracting businesses and maintaining economic dynamism.
Investment Disincentives: Real estate investment, both residential and commercial, becomes less attractive when property taxes consume excessive portions of potential returns. This reduced investment limits construction activity, employment, and economic growth.
Municipal Bond Risks: As property values stagnate or decline due to tax burdens, municipalities face increased difficulty servicing debt obligations, potentially affecting credit ratings and borrowing costs throughout the state.
The Path to Economic Recovery
The Neptune crisis demonstrates that New Jersey’s current approach to school funding is economically unsustainable. Without fundamental reform, the state risks:
- Continued population loss to more tax-competitive states
- Declining property values undermining municipal finances
- Reduced business investment and job creation
- Erosion of the tax base supporting essential services
Immediate Actions Required:
- Emergency State Aid: Restore predictable funding to districts like Neptune that have seen devastating cuts
- Formula Reform: Develop a sustainable school funding mechanism that doesn’t create wild swings in local tax burdens
- Regional Cooperation: Encourage shared services and consolidation to reduce administrative costs
- Economic Development Incentives: Offset high tax burdens with targeted business attraction and retention programs
Conclusion
Neptune’s $1,477 property tax increase is not merely a local budget issue—it’s a symptom of systemic problems threatening New Jersey’s economic vitality. The state’s current school funding approach creates unsustainable tax burdens that drive away residents and businesses, erode property values, and undermine the very tax base needed to support quality education and municipal services.
Without immediate intervention, communities like Neptune will continue to spiral into a cycle of declining services, reduced property values, and economic stagnation. The choice facing New Jersey is clear: reform the school funding system to create sustainable, predictable financing, or watch as punitive tax increases hollow out communities and drive the state’s economic decline.
The Neptune crisis should serve as a wake-up call for state policymakers. The current trajectory is not merely unsustainable—it’s economically destructive, threatening the prosperity and livability that have long defined New Jersey communities.